If the current issues around the Três Estradas Phosphate Project can be resolved I believe AGR could see some very positive action in their share price.
The last economic projections for the project were done with a sales price of $72 AUD / tonne.
The current price is approaching $200 AUD / tonne and the outlook for the product is good. Aguia also has the added advantage of an organic product with its customers in close proximity to the source of production. It has also taken steps to ensure environmentally friendly production.
For comparison Australian company Centrex Metals CXM has recently risen to a MC approaching $50m after its subsidiary Agriflex signed an offtake and marketing agreement with Samsung C&T, one of the world largest fertiliser traders.
The initial deal is for the first 3 years of production from Agriflex’s planned $78m, 800,000tpa Ardmore phosphate project in Queensland.
The initial LOM for Aguias TEPP is 18 years with an original payback period of 2.6 years although this would be considerably shorter now based on the higher AUD phosphate price.
Lets see what strategic recognition by the Brazillian Federal Governmant brings.
